A client has built an out house (similar to a garden shed), this has been kitted with office equipment and is now used solely for business. Can capital allowances be claimed?
Julie Atkinson
Replies (3)
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you can certainly claim on the equipment
however, as regards the outhouse, there are other factors to consider.
pour exemple:
who owns the building etc
doubtful
No problem with claiming capital allowances on the equipment.
As far as the outhouse/shed is concerned, you need to establish whether it performs a function in the business or merely provides the setting in which the business is carried out.
If it performs a function you will be able to claim capital allowances.
I think it is, however, highly likely that it provides the setting and no capital allowances will be available.
No tax relief may be claimed against the cost of the shed.
The shed does not qualify as an item of plant and so CA's cannot be claimed, It is deemed to be a temporary structure and so IBA's cannot be claimed.
The best you can do for your client is to identify associated expendiure - shelving, business furniture and office equipment and claim against these.
Ths is a Q. which has been answered several times on AWeb, if you search you should be able to find more detailed replies
Good luck trying to explain the bad news to your client!
Martin